Standing Out in a Crowd: Differentiating Your Business from Competitors

Among the greatest marketing challenges for small businesses (all businesses, really) is finding ways to truly differentiate themselves from competitors. Being different is not enough: the factors that distinguish your company, products and services from others must also be relevant, and ideally compelling, to your audience.

Offering high quality products or services at competitive prices is not enough; that’s really just a baseline, the ante needed to just play the game. The trick is to find ways to help people understand why they should prefer you over the available alternatives.

This often is a daunting task. I’ve worked with many professional service organizations, including CPAs and law firms, that have struggled to contrast themselves with other businesses offering similar services and expertise. These were fine firms, staffed by extremely bright, well-educated professionals, and yet they often found it difficult to explain why they should be the preferred choice for prospective clients.

The challenge is not limited professional services. Businesses of all types — from florists, dry cleaners and auto mechanics to chiropractors, dentists and plumbers and more — should try to devise ways to stick out in an environment of seemingly limitless options.

There are a variety of areas in which companies can seek to differentiate themselves: products, service, distribution channels, relationships and even image or reputation. How you prioritize them depends on your industry and the needs of your customers

The alternative to effective differentiation is to compete on price. That is a losing proposition — especially in industries facing completion from overseas.

Understanding Customers

Your first step in this effort next step is to do everything you can to really understand your current or prospective customers. The better you know and appreciate the factors that influence their purchase decisions, the better you can tailor your offerings, or at least your messaging, to align with their needs and interests.

Once you identify your prospects’ ideal solution(s), you need to do an honest and candid self-assessment: how well does your business actually meet those needs? How do your products compare with your competitors’ offerings? Do you provide truly superior service? What kind of “customer experience” does your business provide?

Answering these questions can deliver benefits beyond a marketing analysis. It can help you identify areas where you can rectify weaknesses and improve your business overall.

Competitor Analysis

Your next step is to gain a better understanding of your competitors. What do they do well? Poorly? How do they present themselves to the market? What messages do they emphasize in their communications? What weaknesses do you perceive? How salient are such weaknesses to the people you want to influence? What do people say about them on review sites such as Yelp?

These are but a few of the questions that might be considered. Here is a longer list of questions you can use during your research. Here are some information sources that may help you gather this information.

What Makes Your Different — and Preferable?

Now comes the hard part for most businesses: figuring out what really makes you different. What makes you the best choice in your particular category? Dave Avrin, a marketing consultant, author and public speaker, suggests asking yourself likes this fundamental query: “To what question are you the answer?”

A frank analysis may determine that you currently do not have relevant points of differentiation. In that case, your urgent task is to develop one.

In my next post, I’ll offer some suggestions for identifying a variety of distinctive qualities or attributes your customers might find attractive. Once you have an initial list, you’ll need to assess which of these attributes would be most compelling to your audience, what it will take for your business to demonstrate such attributes, and whether or not you can actually evince them without seriously straining your operations or significantly diminishing your profitability